To start, the new dividend allowance introduced in 2016 enables up to £5,000 of tax free dividends. Spouses and civil partners should maximise this by utilising the allowance between them, to prevent one paying dividend tax if the other has an allowance remaining.
Couples can also maximise the available tax reliefs and allowances between them. If one is paying higher rate tax on savings and dividends and their partner has unused savings, dividends or £11,500 personal allowance, assets, including cash savings, may be transferred between them without incurring capital gains tax, making the income more evenly allocated.
Potentially, there is also tax relief for gross pension contributions of up to £40,000 each year, although earnings over £150,000 reduce this allowance to £10,000. However, pension relief may be carried forward for three years, and unused relief from 2014/15 can therefore still be used before it expires on 6 April 2018 to allow scope for further contributions. Tax benefits may also be received from pension contributions for non-working spouses and children.
With ISAs, taxpayers can invest £20,000 tax free in either cash or shares each year. In addition, for 30 per cent and 50 per cent income tax relief respectively, the Enterprise Investment Scheme (EIS) and Seed–EIS (SEIS) schemes should be considered. Both allow deference of (EIS) or partially exempt (SEIS) tax on capital gains made on other assets and capital gains exemption also applies to the new shares taken out.
For non-domiciled individuals resident in the UK for 15 out of the past 20 years, from April 2017 you are now deemed to be UK domiciled for all taxes. Therefore, any worldwide income and gains is subject to UK tax and you are liable for UK inheritance tax on any worldwide assets as you cannot claim the remittance basis. However, a number of transitional reliefs are available and we can help minimise the impact.
Finally, always remember that further reliefs could be available, depending on personal circumstances, and Everfair Tax would always be happy to discuss these options.